• 07.18.16

What to expect from Netflix’s earnings report today

Netflix and sell?  That’s what some stockholders will surely be wondering as they tune into the earnings call with Netflix executives later this afternoon.  Although the video streaming company has seen its revenue and subscribers grow quarter after quarter, its stock has slipped in recent months.  The story remains a positive one overall for Netflix, but competition from HBO, Amazon, and others is heating up. 

Some things to look out for when the earnings call starts after the market closes: 

• New subscribers: Last quarter, Netflix said it expected to add 2.5 million new subscribers this time around. Exceeding or missing this projection could have a big impact on Netflix’s stock.  Even hitting the mark would mean a year-over-year decline in subscriber growth from Q2 of 2015

• International growth: Last year, the company announced a huge international expansion, which helped it break the 81 million subscriber mark. Today’s breakdown between new subscribers in the U.S. vs overseas will offer a hint at how its expansion into 130 new countries is playing out. 

• Original content: Netflix content chief Ted Sarandos vowed to add 31 new shows in 2016 (over 600 hours of new video).  The company is typically tight-lipped about exact numbers, but any change in its original programming strategy could offer a hint at how its newest round of shows are performing. JPT